Elements of Scottish Labour have pushed for this since Keir Hardie founded the party on a Home Rule platform in 1888. The party’s early decades were full of debate about transferring economic power to Scotland, but the option was snuffed out in 1924 when Westminster ignored MP George Buchanan’s Home Rule bill, and then dropped in the 1950s when Labour abandoned the principle.

The Home Rule demand was strongest when the government of Westminster was failing, and weakest when the British Labour party was in its heyday. Scottish people’s confidence in British Labour will be tested in September, but if the Scottish mood is for full powers – and the federalist goals set out by Gordon Brown in recent weeks suggest as much – then Labour would be wise to revive their old demand for Home Rule and the power it brings for working people.

‘Scottish Parliament inhibited’

Jack McConnell will speak today on Home Rule, but it will be a tribute to the status quo (and to his own career). He’ll say: “Home Rule inside the UK has had good days and bad days, but it works and it will continue to grow...” This is complacent: Home Rule means more than the present, tense devolution.

The old objective was for more than social policy powers; it was for economic power. Current devolution – which McConnell calls Home Rule – inhibits our Parliament from structuring growth to raise life standards and take autonomous economic decisions for the benefit of working people. It turns Scottish Labour into a subsidiary of London Labour, and holds economic power far from our hands.

Scottish Labour’s future principles are about to be decided by a drawn-out leadership kerfuffle, and the content of its next manifesto is undecided; but surely Scotland’s party of social justice has the potential to go further than its leadership at Westminster?

In recent years, labour regulation, social investment and other figures of social democracy have crowded into Scottish politics. A Home Rule Labour party could be leading a race to the top, and calling for the fullest powers to start raising the standard of labour and of life. To return to its tradition, Scottish Labour should demand not further powers for Scotland but a settlement of power in Scotland: to alter, improve and reconstruct the economic base, and share the fruits of growth amongst working households and society.

No radical case

However, Scottish Labour has produced no such radical case for how a No vote will help working households. Together We Can, the party’s document on further powers in the event of a ‘Yes’ vote, is strong on history but weak on forward planning. The same is true of Gordon Brown’s account about how the welfare principle can only survive in the UK.

Labour MSP Jenny Marra wrote about shared aspirations for a progressive Scotland in ‘building a better Scotland’, but says precious little about the power to do it. She said “an ambitious and bold agenda for our economy” demands full discussion, but as a socialist she must know that even the most ambitious goal requires the economic power to achieve it.

The best way for Scottish Labour to assert itself would be to demand a radical but recognisable Home Rule settlement. By shrugging off the MPs’ heavy hands the Scottish party would stand tall; it would bring basic economic and industrial issues into Scottish politics; and it will give the party momentum as the bearers of progress, ready to challenge the SNP as the party of government in Scotland.

‘No progress’

A Home Rule position for Scottish Labour would demonstrate that constitutional change is only worth the social change it brings, and will emphasise that ‘powers for a purpose’, Lamont’s favourite slogan, is sincere. Scottish Labour should want power for the advancement of people’s economic interests. If we have the power to do this, our party and movement could plant an economy that grows from people’s combined work and cooperation, and which provides security for all.

But Lord McConnell’s speech today is the clearest sign yet that Labour’s Home Rule journey has hardly progressed for 15 years, and Johann Lamont’s modest, muddled call for income tax and housing benefit powers are too little too late.

And since Scottish Labour shows no sign of making any radical demands, it makes good sense to say that a Yes vote is the only vote for a third option, the SNP’s agenda notwithstanding.

It would open a way for Scottish Labour to wrest control from the morass of London economics, revive its activists, and rebuild its identity. Scottish Labour needs not internal power-struggle but a struggle for power – and a clear route to a better way of higher wages and work security.

Labour fails to offer this, and so a Yes vote is the only route to power.

As a dozen Labour activists wrote last week to Ed Miliband, “a Yes vote will give the Scottish Parliament the ability to improve people’s lives through making work fairer and handing economic power to ordinary people”.

It is “the Home Rule demand Keir Hardie made when he founded our party, and is the central reason why an independent Labour Party will flourish in an independent Scotland.”

• Cailean Gallagher is a member of the Scottish Labour Party and a Yes Scotland campaigner.